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Chilisin to buy into Belkin to establish power choke production.

Taipei, June 28, 2010 (CENS)--Chilisin Electronics Corp., a subsidiary of passive-component maker Yageo Corp., has recently decided to acquire a 54% stake in Belkin International Inc. for around US$90 million to enter into power-choke production.

Industry executives expect the acquisition to help Chilisin vault to major league of power-choke suppliers in mainland China, posing challenges to Delta Electronics, which has commanded 80% of the market for chokes used in laptops.

Belkin is operating two factories each in Guangdong Province and Henan Province to turn out CPU chokes, with output ranging from 10 million to 15 million units a month. Major customers include Asustek Computer, LiteOn Technology, Hon Hai Precision Industry, and Chicony Electronics.

After the acquisition, Yageo and the subsidiary will wholly own Belkin as Yageo already holds a 46% stake in Belkin.

Belkin projects to boost output of power chokes of various types to 20-25 million units after boosting capacity of common-mode chokes to 10 million units in September this year.

Chilisin's executives pointed out that after the acquisition Chilisin's output of CPU power chokes will top 30 million units by adding its own output, which will be expanded to 8-9 million units by the end of this year from current two million units.

They said Chilisin and Belkin will sign the deal by the end of this month and Chilisin will begin consolidating Belkin's sales with its sometime in the third quarter. Currently, Belkin has sales of around US$2.1 million a month and annual earnings of around US$1.8 million. With the expansion, Chilisin expects its annual revenue to increase 50% from a year earlier to NT$3 billion (US$93.08 million) this year.

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Title Annotation:Chilisin Electronics Corp. and Belkin International Inc.
Author:Liu, Ken
Publication:The Taiwan Economic News
Article Type:Brief article
Geographic Code:9TAIW
Date:Jun 28, 2010
Words:282
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